The Savills Portfolio

Landscope

8 April 2020

To try and get money out into the economy more quickly to help businesses affected by the impact of coronavirus, the Government has improved the Coronavirus Business Interruption Loan Scheme and also introduced support for self-employed workers. 

A recruitment drive by supermarkets and increased production of staple food products has seen some easing of the restrictions retailers introduced to help manage the surge in demand for food to eat at home. The impact this had, has highlighted the fragility of our just-in-time food system and should lead to our food security being taken more seriously in the longer term. In the meantime there remain immediate issues to be tackled including an expected significant shortfall in the number of seasonal harvest workers, which requires a solution within the next few weeks.

FOOD & FARMING

Will Coronavirus threaten food security?
Panic food buying by big importers such as governments and millers may lead to food inflation despite healthy stocks in key nations. Chicago wheat futures, a global benchmark, rose more than 6% in a week, its largest gain in the last nine months. Yet global wheat stocks in June are projected to be 287 million tonnes, up 3% from last year. Rice prices in Thailand, the world’s second largest exporter of the grain, are at their highest levels since August 2013, but world rice stocks are also predicted to rise by 4% to 182 million tonnes. The markets reacted to fears that ‘food nationalism’ could disrupt exports of those staple grains; Russia, Kazakhstan, Vietnam and Serbia have all limited exports though none have stopped operations entirely.

The livestock sector is experiencing disruption as a result of the coronavirus outbreak. National Sheep Association Chief Executive Phil Stocker said “the shutdown is having a really damaging impact on the sheep trade now. The trade collapsed at the start of this week with prices down by £1 per kg liveweight”. This almost unprecedented drop in market price is thought to be due to a combination of factors. Fears that exports to France may become more difficult, an overall reduction in export demand and the lack of domestic demand from the pub and restaurant sector have all played a part. To ensure livestock markets can continue to trade safely, the Livestock Auctioneers’ Association has introduced restrictions and new security and hygiene precautions. The sale of prime stock, cull animals and store stock is still permitted, but sales of all breeding stock have stopped. In order to gain access to markets buyers must now register.

Recent events have highlighted the fragility of our just-in-time food system. Whilst the current focus is rightly on immediate food chain issues, the impact of the coronavirus pandemic ought to prompt a review of how much importance is placed upon food security in the UK. When the original Agriculture Bill was published it was criticised for barely mentioning food production. When the Bill was reintroduced to Parliament in January, the Government responded by including a section on food security. It would require the Secretary of State to present a report to Parliament at least every five years “containing an analysis of statistical data relating to food security in the United Kingdom”. Whilst this is an improvement, the obligation is relatively passive and doesn’t actually oblige the Government to proactively manage or ensure food security, and this now seems inadequate. The Government is of course working on its National Food Strategy, and recent events highlight the importance of ensuring our food supply chain is robust in the face of shocks in addition to the significant health, dietary, environment and sustainability challenges it also needs to tackle. The prevailing expectation that, as a wealthy country, we can simply buy our way out of a food security crisis may have been undermined for good.

POLICY

Shortfall in agricultural labour
The farming industry is facing a significant shortfall of horticultural labourers. The sector employs around 70,000 seasonal workers a year and 90% of those workers usually come from the EU, yet coronavirus and Brexit mean a significant reduction in migrant workers is expected. More than 11,000 members of the public have signed up to a new “Land Army” scheme in an attempt to recruit new workers. The ‘Feed the Nation’ campaign was started by Brighton-based charity Concordia, which facilitates volunteering and international work placements to promote intercultural understanding and peace. The NFU is expecting the Government to launch a “Pick for Britain” campaign modelled on its volunteering appeal for the NHS. The Government has already confirmed that furloughed workers are eligible to collect wages with a second job.

The Environment, Food and Rural Affairs (EFRA) Committee has launched an inquiry into labour in the food supply chain. It will investigate how the Government plans to compensate for the projected shortfall and also the result of the two-year Seasonal Workers pilot scheme. Evidence may be submitted for the inquiry until 24 April 2020. The committee has also launched an inquiry into COVID-19 and food supply, focusing on short to medium term issues, the action the Government has taken, and the action it may need to take. Evidence may be submitted for the inquiry until 1 May 2020.

Welsh future rural policy and immediate coronavirus support
The Welsh Government has committed to working with farmers and other land managers to co-design its Sustainable Farming Scheme for Wales. Development work is starting on four of the main topics: farm development opportunities, soil husbandry, habitat management, and animal health and welfare. Click here for information on how to get involved. In recognition of the challenges facing the sector as a result of coronavirus, the Welsh Government has given farmers an extra month in which to submit their Single Application Form to claim 2020 Basic Payment Scheme payments; the deadline is now 15 June. It has also joined England and Scotland in suspending the “three crop rule” for 2020.

ENVIRONMENT & NATURAL CAPITAL

Charity to donate land to nature
Heal Rewilding, a new national wildlife charity, is planning to buy ecologically depleted land across Britain and give it back to nature. The charity will use crowdfunding to purchase former farms, green belt or lower-grade land. Its foundation project will be ‘Heal South’ a £7 million, 500-acre project in the southern English lowlands. The charity will focus on sites within easy reach of large towns and cities so the public can benefit. To convert the sites it will allow them to grow wild from their seed bank, use animal seed dispersal or spread seeds from nearby land. Heal will introduce semi-wild grazers such as pigs, ponies, cattle and deer to sustain a variety of landscapes such as grassland, scrub and woodland zones that will together support a richer mix of species.

Crown Estate Scotland invests £70 million in generation and regeneration
The Crown Estate Scotland has just published a new three year plan stating how it will invest £70 million in the regeneration of coastal communities, renewable energy and sustainable food production.

Savills GWCT Game and Conservation Benchmarking survey
If you would like to take part in our Game and Conservation Benchmarking survey there is still time to do so. We have added some additional questions to investigate what action shoots are taking due to the challenges created by coronavirus. The results of this will be reported in a future edition of Landscope. Click here for more details and to access the e-survey.

Sporting round up

• Wild Justice has abandoned its application to expedite its legal challenge into game bird releases

• Natural England has published two general licences to allow the trapping of stoats in certain circumstances

• The Coronavirus (Scotland) Act has banned muirburn in Scotland with immediate effect for the duration the Act is in force. The shooting community had already instigated a voluntary cessation

• The Scottish Government has been criticised for excluding deer forests, game larders and shooting grounds from its Coronavirus Small Business Support Grant, and shooting businesses from its Retail, Hospitality and Leisure Support Grant.

PROPERTY & DEVELOPMENT

Appeal for rural landlords and tenants to work together
The Tenant Farmers Association and Country Land and Business Association have jointly called for all rural landlords and tenants to work together collaboratively and compassionately during this unprecedented time. The plea is made in respect of all tenancy matters, but particularly rent payments, notices to quit and finalising new tenancy agreements. They say “never has it been more important for the whole of the farming industry to focus one hundred percent on supplying the nation’s food”.

Virtual planning meetings
Local authorities are now allowed to hold public meetings in England virtually. This could allow planning committee meetings to continue during the coronavirus lockdown. Whilst in Scotland, the expiry times of existing permissions have been extended so that any expiring within the next six months are now valid until April 2021.

Scotland: Domestic energy efficiency
The Scottish Government has shelved plans to introduce the Energy Efficiency (Domestic Private Rented Property (Scotland) Regulations 2020 on 1 April 2020. It will resume its work on improving energy efficiency in private rented housing once the current coronavirus crisis comes to an end. Similar legislation was introduced in England on 1 April as planned.

BUSINESS & ECONOMY

Coronavirus business support improved
The Government’s support for small businesses has been criticised after a British Chambers of Commerce survey found that six in ten British companies have no more than three months of cash available to cover running costs. To help such firms the Coronavirus Business Interruption Loan Scheme offers loans of up to £5 million via UK lenders to eligible businesses that have been affected by coronavirus. However the scheme has been criticised because by 3 April just 983 out of 130,000 enquiries had been approved. To help unlock the funding the Chancellor has made a number of important revisions. Banks can no longer request personal guarantees on loans under £250,000 and eligibility has been extended so that all viable small businesses can benefit, not just those who are unable to secure regular commercial financing. Read the latest edition of our Coronavirus: Economic Reliefs briefing note to find out more about the support available for businesses, employment, the self-employed, landlords and tenants.

Fund for community support groups
An £100,000 emergency fund has been set up for support groups providing assistance to farmers affected by the coronavirus crisis. The Prince’s Countryside Fund is inviting applications for grants of up to £2,500 from groups that are providing relief to vulnerable or isolated individuals. Grants may cover expenses such as volunteer and fuel costs for grocery and prescription delivery or foodbanks. It is not for individuals or private farm businesses and is not aimed at funding capital costs. Applications for the Rural Response Emergency Grants Programme close on 15 April. Defra has also announced £3.25 million of funding for food redistribution organisations across England. The first phase will support organisations that have been funded previously and on 9 April it will open to new applicants.

OTHER RURAL NEWS

A rural thank you to the NHS
The nation came together to Clap For Our Carers in an outpouring of appreciation for the NHS workers on the frontline against the coronavirus pandemic. But a Devon farmer nonetheless decided to show his thanks in his own way; by mowing a giant NHS sign into one of his fields. How giant? 100 metres high and 400 metres wide; that’s four hectares. Matthew Alford of Great Hele Farm spent two hours planning and mowing his composition using GPS and a John Deere tractor. Mr Alford said "It's just nice to do something to make them aware it's not going unnoticed".

And finally…
Nature returns to town
Mention marauding animals in the Welsh town of Llandudno and most will think of seagulls snatching chips out of unsuspecting tourists’ hands. But with no tourists or residents to be seen on the deserted promenade, an entirely different species has been running amok. A herd of goats from the nearby Great Orme country park has been filmed trotting along garden walls and eating hedges in the seaside resort. The North Wales Police, which has had run-ins with the vandals before, were called in to guide them back out of the town. Amidst the lockdown, several settlements around the world, including Venice, Italy and Santiago, Chile have seen curious creatures return to their streets.